So who picks the sweetest-smelling one? Ideally, the crowd would. But here’ where striking a balance between the local and the global is essential: a decentralized system can only produce genuinely intelligent results if there’s a means of aggregating the information of everyone in the system. Without such a means, there’s no reason to think that decentralization will produce a smart result. In the case of the experiment with which this book opened, that aggregating mechanism was just Frances Galton counting the votes. In the case of the free market, that aggregating mechanism is obviously price. The price of a good reflects, imperfectly but effectively, the actions of buyers and sellers everywhere, and provides the necessary incentive to push the economy where the buyers and sellers want it to go. The price of a stock reflects, imperfectly but effectively, investors’ judgment of how much a company is worth. In the case of Linux, it is the small number of oders, including Torvalds himself, who vet every potential change to the operating-system source code. There are would-be Linux programmers all over the world, but eventually all roads lead to Linus.

Now, it’s not clear that the decision about what goes into Linux’s code needs to be or should be in the hands of such a small group of people. If my argument in this book is right, a large group of programmers, even if they weren’t as skilled as Torvalds and his
lieutenants, would do an excellent job of evaluating which code was worth keeping. But set that aside. The important point here is that if the decision were not being made by someone, Linux itself would not be as successful as it is. If a group of autonomous individuals tries to solve a problem without any means of putting their judgments together, then the best solution they can hope for is the solution that the smartest person in the goiip produces, and there’s no guarantee they’ll get that. If that same group, though, has a means of aggregating all those different opinions, the group’s collective solution may well be smarter than even the smartest person’s solution. Aggregation—which could be seen as a curious form of centralization—is therefore paradoxically important to the success of decentralization. If this seems dubious, it may be because when we hear centralization we think “central planners,” as in the old Soviet Union, and imagine a small group of men—or perhaps just a single man—deciding how many shoes will be made today. But in fact there’s no reason to confuse the two. It’s possible, and desirable, to have collective decisions made by deéentralized agents.

Understanding when decentralization is a recipe for collec.tive wisdom matters because in recent years the fetish for decentralization has sometimes made it seem like the ideal solution for every problem. Obviously, given the premise of this book, I think decentralized ways of organizing human effort are, more often than not, likely to produce better results than centralized ways. But decentralization works well under some conditions and not very well under others, In the past decade, it’s been easy to believe that if a system is decentralized, then it must work well. But all you need to do is look at a traffic jam—or, for that matter, at the U.S. intelligence community—to recognize that getting rid of a central authority is not a panacea. Similarly, people have become enamored of the idea that decentralization is somehow natural or automatic, perhaps because so many of our pictures of what decentralization looks like come from biology. Ants, after all, don’t need to do anything special to form an ant colony. Forming ant colonies -is inherent in their biology. The same is not, however, true of human beings. It’s hard to make real decentralization work, and hard to keep it going, and easy for decentralization to become disorganization.

A good example of this was the performance of the Iraqi military during the U.S—Iraq war in 2003. In the early days of the war, when Iraqi fedayeen paramilitaries had surprised U.S. and British troops with the intensity of their resistance, the fedayeen were held up as an example of a successful decentralized group, which was able to flourish in the absence of any top-down control. In fact, one newspaper columnist compared the fedayeen to ants in an ant colony, finding their way to a “good” solution while communicating only with the soldiers right next to them. But after a few days, the idea that the fedayeen were mounting a meaningful, organized resistance vanished, as it becare clear that their attacks were little more than random, uncoordinated assaults that had no connection to what was happening elsewhere in the country. As one British commander remarked, it was all tactics and no strategy. To put it differently, the individual actions of the fedayeen fighters never added up to anything bigger, precisely because there was no method of aggregating their local wisdom. The fedayeen were much like nts—following local rules. But where ants who follow their local rules actually end up fostering the well-being of the colony, soldiers who followed their local rules ended up dead. (It may be, though, that once the actual war was over, and the conflict shifted to a clash between the occupying U.S. military and guerrillas using hit-and-run terrorist tactics, the absence of aggregation became less important, since the goal was not to defeat the United States in battle, but simply to inflict enough damage to make staying seem no longer worth it. In that context, tactics may have been enough.)

The irony is that the true decentralized military in the U.S.—Irac1 war was the U.S. Army. American troops have always been given significantly more initiative in the field than other armies, as the military has run itself on the “local knowledge is good” theory. But in recent years, the army has dramatically reinvented itself. Today, local commanders have considerably greater latitude to act, and sophisticated communications systems mean that collectively wise strategies can emerge from local tactics. Commanders at the top are not isolated from what’s happening in the field, and their decisions will inevitably reflect, in a deep sense, the local knowledge that field commanders are acquiring. In the case of the invasion of Baghdad for instance, the U.S. strategy adapted quickly to the reality of Iraq’s lack of strength, once local commanders reported little or no resistance. This is not to say, as some have suggested, that the military has become a true bottom- up organization. The chain of command remains essential to the way the military works, and all battlefield action takes place within a framework defined by what’s known as the Commander’s Intent, which essentially lays out a campaigil’s objectives. But increasingly, successful campaigns may depend as much on the fast aggregation of information from the field as on preexisting, top-down strategies.